Canada’s universal healthcare system, also known as Canadian Medicare, is decentralized and
. It provides relatively equitable access to medically necessary healthcare services through 13 provincial and territorial tax-funded public insurance plans. The recent COVID pandemic, in addition to a lack of healthcare workers, lengthy
, and anticipated increases in demand for care brought on by an aging population have put a strain on Canada's healthcare system. In 2022, overall
is predicted to be 331 billion Canadian dollars or 8,563 Canadian dollars per person. It is predicted that health spending will account for 12.2 percent of Canada's gross domestic product (GDP) in 2022.
How is health care funded?
The Canadian
healthcare system is financed by using a mix of federal and provincial revenue collected through taxation, such as personal and corporate taxes, sales taxes, payroll levies, and other revenue, but it is administered at the local level. More than 70 percent is funded by the provinces and territories, while the federal government funds around 25 percent through the Canada Health Transfer (CHT). The CHT is the largest single transfer that is made to the
provinces and territories. Currently, the provincial governments are urging the federal government to unconditionally and immediately raise the share of healthcare costs funded to 35 percent and maintain it long-term to help cover the rising health costs. However, the federal government is in support of conditional transfers that are targeted toward
specific issues that are seen as "national priorities" such as mental health and
long-term care for the elderly.
Total healthcare expenditure
The Canadian Institute for Health Information (CIHI) reports that hospitals, physicians, and prescription drugs accounted for over 50 percent of the total health expenditure (THE) in 2022. Spending on the hospital category alone amounted to over 80 billion Canadian dollars in 2022, the largest category of THE. In response to the pandemic in 2020, the Canadian government set aside a separate
budget for COVID-related expenditures. The average per capita spending on COVID-19 varied significantly between provinces in Canada from 2020 to 2022. The total health
expenditure is largely funded by the public sector, while the private sector was predicted to account for nearly 28 percent in 2022. Healthcare services like prescription drugs, dental, and vision care are usually
out-of-pocket expenses, accounting for nearly 15 percent of THE in 2019. Although, among all OECD countries the Canadian healthcare system is one of the most expensive it has
ranked poorly when comparing the performance indicators.
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